Assured Guaranty Scales 52-week High - Analyst Blog

Loading...
Loading...

On Jun 17, 2014, shares of Assured Guaranty Ltd. AGO scaled a new 52-week high of $26.78. With about 4.1 million shares exchanging hands in the last trading session, shares gained 3.62% to close at $26.33. The momentum was driven by the first-quarter outperformance and continued efforts to enhance performance. The one-year return from the stock came in at 11.6%, which was ahead of the S&P's return of 5.1%.

With respect to earnings performance, this multiline insurer delivered positive surprise in the last three of four quarters, with an average beat of 4.49% and the highest surprise of 14.3% in the last quarter. Reported income also showed a turn around from loss incurred in the year-ago quarter.

Assured Guaranty's residential mortgage-backed securities' RMBS claims declined 80% since their peak in the second quarter of 2012.

With loss mitigation efforts and de-leveraging of insured portfolio on track, Assured Guaranty's is improving its risk profile. Moreover, it is also writing new businesses. These prompted credit rating agency Standard & Poor's Ratings Services (S&P) to upgrade the financial strength rating of all insurance operating subsidiaries to AA from AA- with a stable outlook, the highest rating that it presently assignes to any active bond insurer.

Operating shareholders' equity per share at quarter end reached a new high of $34.45 with book value per share also improving to $49.79.

With respect to enhancing value of shareholders, Assured Guaranty's resumed its share repurchases in March and spent $35 million to buy back 1.4 million shares in the first quarter. It spent another $40 million to buy back 1.6 million shares in the ongoing second quarter.

Assured Guaranty's is also strengthening its balance sheet. While cash balance improved 18% at first quarter end over the 2013 level, debt level declined 0.5%. Debt-to-capital improved 30 basis points at quarter end.

Assured Guaranty presently carries a Zacks Rank #4 (Sell).

Other Stocks to Consider

Some better-ranked multi line insurers include Horace Mann Educators Corp.HMN, Radian Group Inc. RDN and Old Republic International Corporation ORI. All these stocks sport a Zacks Rank #1 (Strong Buy).
 


Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days.
Click to get this free report


RADIAN GRP INC RDN: Free Stock Analysis Report

ASSURED GUARNTY AGO: Free Stock Analysis Report

HORACE MANN EDS HMN: Free Stock Analysis Report

OLD REP INTL ORI: Free Stock Analysis Report

To read this article on Zacks.com click here.

Zacks Investment Research
Loading...
Loading...
date
ticker
name
Price Target
Upside/Downside
Recommendation
Firm
Posted In: Analyst ColorAnalyst Ratings
We simplify the market for smarter investing

Trade confidently with insights and alerts from analyst ratings, free reports and breaking news that affects the stocks you care about.

Join Now: Free!

Loading...